The firm said that its results would be "materially affected" by the downturn - in effect, issuing its first-ever profits warning.

The news sent Cathay's shares to a 16-month low.

Other Asian airline shares suffered, too, as many of Cathay's peers are expected to follow suit.

Ailing airlines

Hong Kong has the territory most intensely affected by Sars, which has infected at least 2,700 people worldwide and killed at least 106.

The disease has already hit Hong Kong's economic growth, and has reduced tourism and non-essential travel to a trickle.

For airlines and other travel-related businesses, it has been "worse than September 11", said Phil Wickham of ING Financial Markets.

Australia's Qantas recently became the first major Asian airline to cut jobs as a direct consequence of Sars, and Singapore Airlines has also warned that job losses are possible.